e21 Initiative Phase II

What is the e21 Initiative?

The e21 Initiative is a multi-stakeholder effort to develop a more customer-centric and sustainable framework for utility regulation in Minnesota that better aligns how utilities earn revenue with public policy goals, new customer expectations, and the changing technology landscape. (click here for the general e21 Initiative project page)

The e21 Initiative brings together key interests including utilities, consumer advocates, energy technology companies, other businesses, environmental and academic organizations, and government to accomplish this goal and enable Minnesota to continue to lead in shaping an electric system for the 21st century.

e21 is convened by the Great Plains Institute and the Center for Energy and Environment with guidance from the following project partners: George Washington University Law School, Xcel Energy, and Minnesota Power.

The phase II report presents key information and guidance for decision-makers to consider in order to implement e21’s phase I consensus recommendations, released in December 2014.

The main components of the report are an overview section and three white papers on:

Performance-based compensation

Integrated systems planning

Grid modernization

This report was written primarily for Minnesota’s electric utility regulators, policymakers, organizations representing ratepayers, and others who have a stake in the direction of Minnesota’s future electric system. It is also e21’s hope that this report will be useful to others outside of Minnesota who are grappling with similar issues, albeit in their own context.

The phase II report is intended as a cohesive package, with each white paper relating to and supporting the other three.

e21 Phase II Process & Report Background

In its first phase (Feb. to Dec. 2014), e21 achieved consensus that Minnesota should evolve toward a more consumer-centric, performance-based regulatory approach and utility business model (see Phase I Report). e21's Phase II (January 2015 to December 2016) aimed to build on the consensus recommendations of phase I, but in more specific areas, with more participants involved.

The phase II report reflects a great deal of work by participants representing a broad cross-section of the public interest, and a substantial increase in the understanding of the positions and concerns of all participants in this phase. On a number of items, however, consensus was hard to come by. In the end, the e21 co-directors decided not to push the group to final consensus on these items or on the report as a whole, deciding that the additional work and time necessary to come to a more complete consensus would outweigh the benefits of achieving it. Instead, in those areas, the phase II report reflects the range of views held by participants or indicates more specific areas of disagreement.

Each white paper was initially developed in e21 subgroups and informed by discussions in the full e21 group. The phase II overview and summary represent a synthesis of e21’s phase II efforts by staff to e21. Given that this report is not a consensus-based document, the views expressed in this report should not be attributed to any individual participant of e21.

News & Supporting Information

Next Steps

e21’s co-directors are in the process of designing the next phase, including restructuring how it functions in order to more deeply engage with regulators and regulatory staff, open the process to a wider range of interests, continue to meaningfully engage utilities, increase consumer advocate participation, and engage more extensively with national experts to best inform the e21 process. For a more detailed description, see Appendix A: Where from Here in the Phase II report.